What is the Wolfcamp Shale? The Wolfcamp Shale
is a shale formation located in the Permian Basin of Texas and New Mexico. The Wolfcamp Shale is an oil & natural gas zone located below the Spraberry Formation which is also an oil field. Directly below the Spraberry oil play, we find the Dean sandstone and then the Wolfcamp
oil shale formation. There is a conflict between operators as to what to actually call the Wolfcamp Shale....some
people refer to it as the Wolfberry Trend because it's right below the Spraberry Trend. Other common terms for the Wolfcamp Shale are the Wolfcamp Trend, Wolfcamp
Formation, Wolfcamp Oil Play, Wolfcamp Oil Shale, Wolfcamp Oil Field, and even the Wolfberry which is a combination of the
Wolfcamp and Spraberry. The main term is the Wolfcamp Shale with is a non organic shale.

For Decades, drilling companies have been drilling the Spraberry field which was discovered
in 1943 by a farmer in Dawson County. Production didn't really start until 1953 in Midland Texas where companies drilled
the Spraberry Formation as well as the Dean Formation. Due to advances in technology, companies have been tapping into
the Wolfcamp Shale and are having huge success. The Wolfcamp Oil Play has had so much success, there is a giant
land grap of mineral rights land leases going on. For the most part though, these exploration companies already own
mineral rights leases from the Permian Basin itself. The Wolfcamp Oil discovery is even causing exploration companies
to rework old wells now that horizontal drilling has caught fire. There seems to be a ton of activity here which is
similar to the Eagle Ford Shale, Granite Wash, Niobrara Shale, and Bakken Shale.

How much oil is in the Wolfcamp Oil Field? Estimates have the Spraberry Shale
holding up to 10 billion barrels of oil as well as 3 trillion cubic feet of natural gas. It is way to early to tell
how much oil is in the Wolfcamp Shale but I would guess over 1 billion barrels. The hot spots of the Wolfcamp seems
to be in Upton County, Midland County, Andrews County, Irion County, Loving County, Pecos County, Winkler County, Glasscock
County, and Howard County. The Wolfcamp Formation is in it's early phase so I am sure I will be adding more hot spots
to this list as company drill more wells.

It is imporant to note that on the Western side of the Wolfcamp near
Loving County, TX, we have the Bone Spring Formation right above the Wolfcamp. The Bone Spring Shale is also highly active right now and is three different zones that are
producing oil. In New Mexico, the Avalon Shale is the first zone of the Bone Spring which is also being called the Leonard Shale because it is Lenardian in age.....very confusing I know!

So in short, In the Permain Basin, the top layer ( to the east ) is the Spraberry Trend, below
the Spraberry is the Dean Formation, and then the Wolfcamp ( Wolfberry Trend ). To the west is the Bone Spring formation
( consists of three zones with the 1st being the Avalon Shale ) with the Wolfcamp Shale below the Bone Springs.
A lot of different zones are coming into play. A lot of oil left to be found!! All possible because of horizontal
drilling.

Chesapeake Energy CHK - Permian Basin Unconventional Liquids Plays (West Texas and southern New Mexico): Chesapeake
has built a strong position of approximately 290,000 net acres of leasehold in four Permian Basin unconventional liquids plays:
the Avalon Shale, Bone Spring, Wolfcamp and Spraberry in West Texas and in southern New Mexico. The company has drilled
and completed 100 gross wells to date in these four plays. Chesapeake anticipates operating an average of approximately
five rigs in its Permian Basin unconventional liquids plays in 2010 to drill approximately 60 net wells. In 2011 and
2012, the company plans to increase its operated rig count as it continues its transition away from natural gas drilling to
more liquids-rich drilling.

EOG Resources EOG - EOG Resources (EOG) Wolfcamp Shale - In the Permian Basin Wolfcamp in Texas,
In the West Texas Permian Basin, EOG increased drilling activity in the Wolfcamp formation during the second half of 2011
in preparation for a more active year in 2012. EOG reported success from the upper Wolfcamp zone. The University 9 #2803H
in Reagan County, 25 miles west of its current middle Wolfcamp activity began production at 883 Bopd with 68 Bpd of NGLs and
388 Mcfd of natural gas. EOG has a 100 percent working interest in the well. In Irion County, the University 43 #0902H and
40A #0402H were completed in the middle Wolfcamp zone at initial oil rates of 1,088 and 1,076 Bopd, respectively. In addition
to the strong oil production, the wells were turned to sales with 86 and 129 Bpd of NGLs and 489 and 736 Mcfd of natural gas,
respectively. EOG has 90 and 85 percent working interest in the wells, respectively. On the border between Irion and Crockett
counties, the University 40 #1309H and 38 #0601H began production at 1,738 and 1,077 Bopd with 137 and 119 Bpd of NGLs and
779 and 678 Mcfd of natural gas, respectively. EOG has 88 percent working interest in these wells. EOG plans to operate a
four-rig drilling program in the Wolfcamp during 2012.

ConocoPhillips COP - ConocoPhillips (COP) announced they have started an acreage position in the Wolfcamp Shale- In this quarter, we added 33,000 acres in the emerging Wolfcamp shale
play in the Midland Basin

PetroHawk Energy (HK) - Petrohawk Energy (HK) Expands to the Wolfcamp Shale - Petrohawk began building an acreage position
in the Permian Basin in the second half of 2010, and has now acquired or has committed to acquire approximately 325,000 net
acres at an average cost of approximately $1,400/acre with over 90% expected to be operated.
The Company's core position includes acreage in the Midland Basin, where the primary target is the Lower Wolfcamp, and acreage
in the Delaware Basin, where the primary targets are the Lower Wolfcamp Shale, Bone Springs
Sands and Avalon Shale.

Petrohawk will allocate approximately $75 million
of drilling and completion capital to drill on its Permian Basin acreage during 2011. The Company plans to run four rigs in
the Basin with 15 wells scheduled to be drilled. Capital spending in this area is scheduled to gradually increase throughout
2012 and beyond with most lease terms providing for a four to five year development window. Hawk Field Services LLC, the Company's
midstream subsidiary, is in the planning stages to address infrastructure issues and opportunities for both Petrohawk and
third-parties.

In the Midland Basin, Petrohawk plans to target oil with associated natural gas
in the Wolfcamp Shale at a vertical depth of approximately 8,000 feet. The Company projects that horizontal wells will have
laterals in excess of 5,000 feet at an estimated cost of approximately $7.0 million per well.
Petrohawk's acreage position is concentrated in two primary areas. In the southern portion of the basin, Petrohawk's position
has been moderately de-risked with multiple successful horizontal wells reported by other operators. The Company's position
in the northern end of the basin is largely untested, but the Company's geological evaluation indicates encouraging petrophysical
characteristics in the Wolfcamp Shale that are believed to be comparable in reservoir quality and reserve potential to the
southern end of the basin.

The Delaware Basin holds three objectives
- the Avalon Shale, Bone Springs Sands and the Wolfcamp Shale, in a gross interval of approximately 3,000 feet. These targets
are found at a vertical depth of between 5,000 and 12,000 feet across the basin. The Company expects a product mix of primarily
condensate and natural gas with significant NGL yield. Horizontal wells are forecasted to cost between $6.5
and $8.0 million.

Pioneer Natural Resources PXD - Pioneer Natural Resources PXD Wolfcamp Shale. In the horizontal Wolfcamp Shale play, the Company
believes it has significant resource potential within its acreage based on its extensive geologic data covering the Wolfcamp
A, B, C and D intervals and its drilling results to date. Pioneer is the largest acreage holder in the play with more than
400,000 prospective acres.

The Company’s current focus is the Wolfcamp B interval in 200,000 acres in the southern
part of the field to hold expiring acreage. EURs in this area are expected to range from 350 MBOE to 500 MBOE per well. Current
plans call for drilling 90 horizontal wells in this area by the end of 2013, with 30 to 35 horizontal wells being drilled
in 2012. Four horizontal rigs are currently operating, up from one horizontal rig at the beginning of the year. Pioneer expects
to increase to seven rigs by the end of 2012 with a further increase to 10 rigs in early 2013. Well costs are currently averaging
$8 million to $9 million per well, which includes the costs of coring, extra logging and micro seismic. Once Pioneer switches
from drilling these “science” wells to development wells, drilling costs are expected to range from $6 million
to $7 million per well.

Devon Energy DVN - Devon Energy (DVN) provides a Wolfcamp Shale Update - We
only recently began drilling on the 92,000-net-acre Wolfcamp shale position that we have established in the Southern Midland
Basin. We brought 4 Wolfcamp Shale horizontal wells online in the fourth quarter, with the best well delivering a 24-hour
IP of 935 barrels of oil equivalent per day. The results of our wells, combined with industry results around our position,
give us confidence and consistent economic results in this play. We are continuing to fine-tune our drilling and completion
techniques and have just finished drilling our first 7,100-foot lateral, which included a 30-stage completion. This well is
just starting to flow back. We'll keep you posted and updated on our progress.

Linn Energy LINE - LINN Energy operates approximately 800 wells and produces more than 5,100 barrels of oil equivalent per day in the Permian
Basin. The Company currently has two active rigs in the Permian Basin Wolfberry trend, where it expects to increase to three
active rigs and drill or participate in 50 wells during the second half of the year. LINN has identified 165 Wolfberry drilling
locations, which equates to a three-year inventory at current spacing. Results in this area to date have exceeded expectations
from our acquisition model, and the Company will continue to target this area for additional acquisition opportunities.

SandRidge Energy SD - Permian Basin - SandRidge currently operates 17 rigs in the Permian Basin. Sixteen rigs are operating on the Central
Basin Platform drilling primarily San Andreas and Clear Fork vertical wells at depths from 4,500 feet to 7,500 feet. One rig
is active in the Wolfberry play in the Midland Basin. SandRidge currently controls about 332,000 gross acres and 243,000 net
acres in the Permian Basin. The company has identified approximately 8,100 low risk drilling locations (net of approximately
700 potential planned divesture locations) and will drill approximately 518 wells in 2010 and 804 wells are planned for 2011.
Through acquisitions and an active drilling program, SandRidge's Permian Basin production has grown from 20.45 MMcfe per day
in the third quarter of 2009 to 141.31 MMcfe per day in the third quarter of 2010. Approximately 64% of SandRidge's Permian
Basin production is crude oil, 15% is natural gas liquids and 21% is natural gas.

The company plans to sell certain non-core oil
assets in the Permian Basin. Assets currently being marketed include Wolfberry and Bone Spring packages. The Wolfberry package
includes approximately 1,700 Boe per day of production and 19,000 acres. The Bone Spring package includes approximately 43,000
net acres for the potential development of the Avalon Shale and Bone Spring reservoirs. There is no production or proved reserves
associated with the Bone Spring acreage. Other Permian assets that may be considered for divestiture in 2011 include non-core
producing properties in Lea and Eddy Counties, New Mexico. Combined production associated
with all assets under consideration for divestiture in 2011 is approximately 1 MMBoe. Production from these properties has
not been included in the company's 2011 guidance. Proceeds realized from these transactions will be used to fund a portion
of the company's planned capital expenditures in 2011. Additionally, while the company intends to operate 10 rigs in the Mississippian
horizontal oil play in 2011, it may monetize a portion of its acreage in the Mid-Continent region through one or more strategic
transactions.

Cimarex Energy XEC - Cimarex Energy (XEC) Wolfcamp Shale Oil Field - In the fourth-quarter, four horizontal Wolfcamp wells were brought
on production in southern Eddy County New Mexico (White City) and northern Culberson
County Texas. The wells brought on in the fourth-quarter had first-30 day production rates averaging 6.8 MMcfe/d, comprised
of 38% gas, 31% oil and 31% NGL. On average these wells have the highest oil contribution of the wells drilled to date in
the Wolfcamp. For 2011 Cimarex drilled and completed 11 gross (10 net) horizontal Wolfcamp wells, bringing total wells in
the play to 18 gross (16.8 net). First 30-day production from all the wells has averaged over 6.5 MMcfe/d, comprised of 44%
gas, 24% oil and 32% NGL.

Whiting Petroleum (WLL) - Whiting Petroleum (WLL) Wolfcamp Shale Update 2011 - Big Tex Prospect. As of April
15, 2011, Whiting had accumulated 111,665 gross (83,303 net) acres in our Big Tex prospect area in Pecos, Reeves and Ward
Counties, Texas in the Delaware Basin. We are also continuing to acquire acreage in this area. Our average acreage cost to
date is $516 per net acre, and we have an average working interest of 75% and an average net revenue interest of 56%. We have
completed 10 vertical wells over the past nine months in the southern portion of the Delaware basin. Prospective formations
include the Wolfcamp and Bone Spring horizons.

Our first vertical well in this area, the Trainer Trust 16-2, had a peak
flow rate of 816 BOE per day and continued to flow for six months, producing over 45,000 barrels of oil during its first six
months of production. The well produced at a restricted rate for 45 days during that period. Subsequently, nine vertical wells
have been completed with average initial production rates of 283 BOE per day. We have four drilling rigs in Big Tex and recently
kicked off a four-well horizontal drilling program. We consider this play to be in an early stage. Further drilling is subject
to evaluation of our drilling and completion results.

We recently completed four horizontal Wolfcamp wells. The table below summarizes the 24-hour
initial producing rates for these wells.

Horizontal Pilot Wells

LateralLength

(Feet)

No. ofStages

Oil

(Bbls)

NGLs

(Bbls)

Natural Gas

(Mcf)

Total

(Boe/d)

Percent Oil

PercentTotalLiquids

University 45 F #2301H

7,749

34

1,136

96

467

1,310

87

%

94

%

University 45 F #2302H

7,698

28

986

83

404

1,136

87

%

94

%

University 45 E #1101H

7,712

35

632

30

147

687

92

%

96

%

University 42 B #1001H

7,769

28

324

120

584

541

60

%

82

%

The University 42 B #1001H well is our first well testing
the Wolfcamp “C” zone. Based on microseismic data and analysis we believe we only effectively fracture stimulated
18 out of 28 stages, and, in addition, approximately 1,250 feet of the wellbore was not fracture stimulated. We expect to
complete the 1,250 feet of the wellbore that was not fracture stimulated during the first quarter of 2012. Although the fracture
stimulation was not optimal, we are encouraged by our first horizontal “C” bench pilot well.

We currently are completing two additional horizontal Wolfcamp wells, the University 45 C #804H well
(7,811 feet lateral) and the University 45 C #805H well (7,849 feet lateral). Both horizontal Wolfcamp wells target the Wolfcamp
“B” and “A” zones. The University 45 F #2304H well (7,641 feet lateral) is waiting on completion,
and we currently are drilling the University 45 F #2303H. We expect to complete both of these wells in March 2012.

Apache (APA) - Apache (APA) Wolfcamp Formation - In the Southern Midland Basin, we leased 20,000 acres in the Wolfcamp shale play in Irion
County, which brings our total to 25,000 acres. This is in addition to 31,000 acres in the form of BP leasehold we have in
the same area. And during 2012, we plan to drill up to 6 horizontal wells on these properties. We currently think there's
potential for up to 150 locations, horizontal wells in this area.

Since Forest's last earnings release, the Company completed two horizontal Wolfcamp Shale oil wells (100% working interest)
that had average 24-hour initial production rates of approximately 200 Boe/d (96% oil). The wells were completed in the lower
part of the Wolfcamp Shale interval. Based on initial well data, Forest intends to target the middle and upper portion of
the Wolfcamp Shale interval in the future development of the play.

After the completion of the Wolfcamp Shale oil wells,
Forest moved the rig to the Delaware Basin to drill its first vertical Wolfbone well, which is currently awaiting completion.
The drilling of a second well has commenced and is scheduled to be completed in the second quarter of 2012.

Concho Resources (CXO) - Concho Resources (CXO) Wolfcamp Shale - During 2011, the Company commenced the drilling of or participated in
a total of 810 gross wells (708 operated), 681 of which had been completed as producers, all of which were successful, and
124 of which were in progress at December 31, 2011. In addition, during 2011, the Company completed 153 wells that were drilled
prior to 2011. Currently, the Company is operating 31 drilling rigs in the Permian Basin; 9 of these rigs are drilling Yeso
wells in the New Mexico Shelf, 14 are drilling Wolfberry wells in the Texas Permian, 7 are drilling in the Delaware Basin
targeting the Bone Spring play, which includes the Avalon shale, the Bone Spring sands and the Wolfcamp shale, and 1 rig is
drilling Lower Abo wells in the New Mexico Shelf.

Southwestern Energy (SWN) - Southwestern Energy (SWN) could be drilling the Wolfcamp Shale soon - The company has also announced it has leased
238,057 net acres in the Denver-Julesburg Basin in eastern Colorado where the company will begin testing a new unconventional
oil play targeting middle and late Pennsylvanian to Permian age carbonates and shales. Common strata names include the Atoka,
Desmoinsian-Cherokee-Excello-Tebo-Marmaton, Missourian, Virgilian, and Wolfcamp. The play objectives range in vertical depth
from 8,000 to 10,500 feet and are within the oil window. The combined Wolfcamp-Atoka interval is over 1,500 feet thick. The
primary objectives are alternating low permeable, 20 to 100 foot thick carbonates separated by 10 to 75 feet thick organic
rich, carbonate mudstones with total organic carbon estimates ranging from 2% to 27%. Total thickness of the objective section
ranges from 300 feet to 750 feet. This acreage was obtained for approximately $42 million and the company's leases currently
have an 85% average net revenue interest and an average primary lease term of 5 years which may be extended for an additional
3 years. In February 2012, the company submitted a drilling plan to the Colorado Oil and Gas Conservation Commission for approval
to spud its first well in the second quarter of 2012. This well will first be drilled 9,500 feet vertically, cored and then
a 2,000-foot lateral will be drilled. If the company's drilling program yields positive results, it expects that activity
in the area could increase significantly over the next several years.